The large-scale merger of marijuana multistate operators Cresco Labs and Columbia Care is in question after the companies failed to divest assets necessary for regulatory approvals by the June 30 deadline.
It’s not clear if the companies are still working toward completing the transaction or if they will abandon it.
“At this stage, Cresco and Columbia Care are working amicably with respect to the next steps in relation to the transaction and will provide further updates in the near future,” the companies said Friday in a joint news release.
An MJBizDaily request for more detail was not immediately returned.
Chicago-based Cresco Labs announced its intention to acquire New York-headquartered Columbia Care in March 2022 in an all-stock transaction valued at $2 billion at the time.
The deal’s closing is contingent on the divestiture of a number of assets in several markets to meet the requirements of state regulators.
The companies made some progress, agreeing last November to sell nine retail outlets and three production facilities in Illinois, Massachusetts and New York to business mogul and rapper Sean “Diddy” Combs.
The deal’s closing was delayed until March 2023 and then until June 30 because some assets still hadn’t been sold.
Columbia Care laid off 25% of its corporate workforce in January.
At the time, Columbia Care CEO Nicholas Vita said in a statement that he wanted to bring profitability to Cresco Labs.
“We continue to look forward to our merger with Cresco Labs and to providing updates as the transaction progresses, and as we deliver on our commitment to be one of the best companies in the sector,” he said. (Full Story)